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21. Costs and Benefits of Labour Mobility between the EU and the Eastern Partnership Partner Countries. Country report: Armenia

Author:
Gagik Makaryan and Mihran Galstyan
Publication Date:
09-2013
Content Type:
Special Report
Institution:
Center for Social and Economic Research - CASE
Abstract:
The purpose of this study is to explore and assess the costs and benefits of labour migration in Armenia and the potential of migration for contributing to the country’s development. We also examine how policy can be effectively formulated and implemented so that Armenia can get the most out of its migration experience. Lastly, we analyse how a phenomenon that emerged because of limited opportunities for employment – migration – evolved into a strategy towards development and prosperity. Based on this analysis, this paper makes a strong argument in favour of implementing programs in Armenia that involve the active collaboration of government institutions and the Armenian Diaspora, duly considering the unusual influence the latter has on Armenia’s economic and human development.
Topic:
Migration, Labor Issues, European Union, and Partnerships
Political Geography:
Europe and Armenia

22. Fiscal or Bailout Union: Where Is the EU/EMU’s Fiscal Integration Heading?

Author:
Marek Dabrowski
Publication Date:
09-2013
Content Type:
Special Report
Institution:
Center for Social and Economic Research - CASE
Abstract:
The European debt crisis triggered a debate on the lacking components of the EU and EMU integration architecture. Many believe that a common currency requires closer fiscal and political integration as a condition for its survival. This opinion is not necessarily supported by the experience of other monetary unions, especially those created by sovereign states. On the other hand, the current EU integration architecture already contains several elements of fiscal union. Furthermore, in several important policy areas such as financial supervision, defense, security, border protection, foreign policy, environmental protection, and climate change, the centralization of tasks and resources at the Union level could offer increasing returns to scale and a better chance to address pan-European externalities. This applies to the entire EU, not only to the Eurozone. Each variant of fiscal integration must be based on sound foundations of fiscal discipline. Market discipline, i.e., the danger of sovereign default, supplemented by clear and consistently enforced fiscal rules is the best solution to this problem. Unfortunately, since 2010, the ‘no bail out’ principle has been replaced by a policy of conditional bailout of governments in fiscal trouble. Some proposals, such as Eurobonds or the lender of last resort to governments, go even further in this direction, and threaten to build a dysfunctional fiscal union.
Topic:
Debt, European Union, Macroeconomics, Fiscal Policy, and Eurozone
Political Geography:
Europe

23. Cost and Benefits of Labour Mobility between the EU and the Eastern Partnership Partner Countries

Author:
Luca Barbone and Matthias Luecke
Publication Date:
10-2013
Content Type:
Special Report
Institution:
Center for Social and Economic Research - CASE
Abstract:
Migration from Eastern Partnership (EaP) countries has only become a large and important phenomenon over the last twenty years. At its heart, labour migration reflects entrepreneurial decisions by individuals and families looking to improve their lives while facing complex challenges and opportunities. In the past, the language of "migration management" was sometimes used to suggest that migrants and migration needed to be “managed” to achieve government objectives. By contrast, in adopting a migrant-centered perspective, our project aimed to understand, first, EaP migrants’ incentives and the effects of migration on migrants and their families, on non-migrants in the country of origin, and on residents of the destination country. Second, we investigated how labour migration is shaped by and interacts with a wide range of government policies and which policy interventions can enhance the benefits of migration for the affected groups.
Topic:
Migration, Labor Issues, European Union, and Partnerships
Political Geography:
Europe

24. Study to quantify and analyse the VAT Gap in the EU-27 Member States

Author:
Leon Bettendorf, Luca Barbone, Michael Smart, Mikhail Bonch-Osmolovsky, Misha V. Belkindas, and Richard M. Bird
Publication Date:
12-2013
Content Type:
Special Report
Institution:
Center for Social and Economic Research - CASE
Abstract:
This report presents and discusses the findings of the “Study to quantify and analyse the VAT Gap in the EU-27 Member States”, conducted by CASE and CPB. The main aim of the study was to help better understand the recent trends in the field of VAT fraud and analyse determinants of VAT Gaps using a number of econometric techniques. The authors discuss the structure of the VAT systems in the EU, the broad trends in the EU economy over the period 2000-2011, and review the behaviour of VAT revenues, as well as the changes in VAT rates and exemptions that have occurred as a response to economic events or policy decisions. They pay particular attention to the events following the onset of the economic crisis in 2008. Moreover, they discuss the definition of VAT Gaps that has been used in this study, as well as other alternatives existing in the literature. They review possible shortcomings associated with different concepts. Subsequently, they present the results of the estimations for EU-26 countries for the period 2000-2011. The estimates are first discussed for the EU-26 as a whole, and then for each country individually. Finally, an econometric analysis of the determinants of VAT Gaps for the period under consideration is provided.
Topic:
European Union, Economic Growth, Fiscal Policy, VAT, and Financial Sector
Political Geography:
Europe

25. Fiscal and Monetary Policy Determinants of the Eurozone Crisis and its Resolution

Author:
Marek Dabrowski
Publication Date:
08-2012
Content Type:
Special Report
Institution:
Center for Social and Economic Research - CASE
Abstract:
Unlike the crisis years of 2007-2009 (when the insolvency of large banks was a major problem), the current round of the global financial crisis has fiscal origins. Almost all developed countries suffer from an excessive public debt burden that has been built up over the last two decades or more. The financial crisis caused a further deterioration of government accounts as a result of ill-tailored countercyclical fiscal response and, in some cases, a costly financial sector rescue. All excessively indebted countries must conduct fiscal adjustment, even if this involves economic and political costs in terms of lower output and higher unemployment. Central banks can reduce these costs through accommodative monetary policies but without compromising their anti-inflationary missions and institutional independence. The ECB is additionally constrained by its institutional status which is based on a delicate cross-country political consensus. Excessive ECB involvement in quasi-fiscal rescue operations can undermine this consensus and lead to a disintegration of the Eurozone. There are also strong arguments in favor of strengthening fiscal and banking integration within the EU, especially the fiscal discipline mechanism at national levels, and building the EU rescue capacity in respect to sovereigns and banks based on strong policy conditionality.
Topic:
Financial Crisis, European Union, and Sovereign Debt
Political Geography:
Europe

26. EU-Ukraine DCFTA: the Model for Eastern Partnership Regional Trade Cooperation

Author:
Veronika Movchan and Volodymyr Shportyuk
Publication Date:
10-2012
Content Type:
Special Report
Institution:
Center for Social and Economic Research - CASE
Abstract:
The EU has been one of the largest trade partners for so called Eastern Partnership (EaP) countries, namely Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine. Commodity turnover of these countries with the EU vary between 30% and 50% of total, but their access to the EU market is less preferential than for many other neighboring countries. They trade with the EU on the basis of MFN regime, and five EaP countries, with exemption of Belarus, use privileges provided by Generalized System of Preferences (GSP) or the GSP+ or autonomous trade preferences (Moldova). With the launch of EaP initiative in 2009, relations between the EU and the Eastern European countries (Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine) have received new impetus for development. The EaP offers upgrade of relations within three major dimensions, namely (a) the Association Agreement (AA), (b) Agreement on a Deep and Comprehensive Free Trade Area (DCFTA), and (c) Visa Facilitation and Readmission agreements. The AA talks have been launched with all EaP countries expect for Belarus, and four of them have been involved in the DCFTA talks. Ukraine has progressed the most, as after five years of negotiations the EU-Ukraine Association Agreement with embedded DCFTA has been initialed in 2012.The aim of this study is to assess gains and losses that could arise from the DCFTA with the EU for the EaP countries, using information about EU-Ukraine DCFTA as model case for EaP regional trade cooperation.The focus of the paper is on non-tariff (regulatory) component of the EU DCFTA and potential implications of regulatory approximation. Also, current level of harmonization of EaP countries’regulatory framework with the EU acquis in the areas related to the DCFTA is analyzed.
Topic:
Globalization, European Union, Regional Integration, Trade, and Economic Integration
Political Geography:
Ukraine and Eastern Europe

27. Agglomeration in Europe in the Context of Socio-Ecological Transition

Author:
Constantin Zaman and Izabela Marcinkowska
Publication Date:
12-2012
Content Type:
Working Paper
Institution:
Center for Social and Economic Research - CASE
Abstract:
This paper analyses the spatial distribution of economic activity in the European Union at NUTS2 level over the 2001-2010 period. The aim of the study is twofold: (i) to provide descriptive evidence of the agglomeration distribution in Europe and its evolution over time across countries; (ii) to identify the nature of agglomeration and the factors that determine its level, with particular attention paid to the socio-ecological transformation occurring in Europe. The study concludes that: a) the changes in agglomeration are sensitive to demographic transformations taking place; b) the ecological transformation has a mixed effect, depending on each country; c) significant differences are observed between new and old Member States; the crisis has had a significant influence on agglomeration but only in Western Europe.
Topic:
European Union, Inequality, Economy, and Agglomeration
Political Geography:
Europe

28. Is Free Trade with the EU Good for Ukraine?

Author:
Marek Dabrowski and Svitlana Taran
Publication Date:
03-2012
Content Type:
Policy Brief
Institution:
Center for Social and Economic Research - CASE
Abstract:
The negotiations on the Association Agreement (AA) between the European Union (EU) and Ukraine, including its trade component, i.e., the Deep and Comprehensive Free Trade Agreement (DCFTA), were completed in December 2011. The agreement is practically ready to be signed, if the EU’s concerns related to the deteriorating political freedoms in Ukraine are addressed. The ball is now in Ukraine’s court and the correct and rapid response is crucial for the country’s future. Both the AA and the DCFTA offer Ukraine an opportunity to deepen its political and economic relations with the EU and modernize its own economy and state institutions. However, if fundamental economic, political, and institutional reforms are not accelerated and conducted in a more comprehensive and consistent way, the prospect of implementing the DCFTA (and its potential benefits) will come under question.
Topic:
Globalization, European Union, Free Trade, Trade, and Economic Integration
Political Geography:
Europe, Ukraine, and Eastern Europe

29. The need for contingency planning: potential scenarios of Eurozone disintegration

Author:
Marek Dabrowski
Publication Date:
06-2012
Content Type:
Policy Brief
Institution:
Center for Social and Economic Research - CASE
Abstract:
Since the beginning of 2010, the common currency area in Europe found itself under serious strain as a consequence of the sovereign debt crisis in several member states. While a substantial political and financial effort has been made to avoid a collapse of the Euro project, its ultimate outcome remains uncertain due to continuous financial market pressures and political challenges faced by individual member states. Therefore, one cannot entirely rule out the possibility of either a partial or total breakup of the Eurozone, even if such a demise would bring about disastrous economic and political consequences for the entire EU and its external partners.
Topic:
Debt, European Union, Economic Policy, Macroeconomics, and Eurozone
Political Geography:
Europe

30. Emerging from Crisis: the Mediterranean Neighborhood

Author:
Leonor Coutinho
Publication Date:
01-2011
Content Type:
Working Paper
Institution:
Center for Social and Economic Research - CASE
Abstract:
"The financial crisis engulfed the entire world economy, but the impact was uneven across many regions and countries. Due to a lower degree of financial integration, many developing countries seem to have been far less affected. This apparent resilience has been observed among several of the EU's Mediterranean (MED) neighborhood countries. However, the region's underdeveloped financial markets may yet prove to be a long-term economic curse."
Topic:
Development, Globalization, Financial Crisis, European Union, Macroeconomics, and Trade
Political Geography:
Europe and Mediterranean